IBM's Ginni Rometty: Growth and comfort do not coexist

JESSI HEMPEL: I love talking to this conference because nobody’s on their BlackBerry. (Laughter.)

GINNI ROMETTY: Not yet. (Laughter.)

JESSI HEMPEL: Not yet. It’s because you’re twittering, I’m sure. We’re lucky enough to be joined by someone this morning who has been with IBM for a good part of your career.

So, I want to kick us off by asking you, how is life different for young women entering IBM (IBM) today than it was for you when you arrived?

GINNI ROMETTY: You know, Jessi was gracious to not say how many years that was. I was dreading she would say it.

JESSI HEMPEL: It was five years ago.

GINNI ROMETTY: Yeah. (Laughter.) No, it was a couple lifetimes ago. I think about when I joined, and it’s probably worth saying something. It was a very personal choice because I was an engineer by training, and I first worked in a manufacturing company. And the reason I came to IBM was I think — I always say at a really early age, I learned you’ve got to be passionate about what you do. No matter what it is, you put too much, your heart and soul in it, you have to be passionate about it. You make too many sacrifices.

And so when I moved to IBM, I moved because I thought I could apply technology. I didn’t actually have to do my engineer — I was an electrical engineer, but I could apply it. And that was when I changed. And when I got there, though, I have to say, at the time, I really never felt there was a constraint about being a woman. I really did not. Over time, and I think the biggest reason that was I never felt the constraint is I was always surrounded by people that wanted to mentor you. And, you know, I know that has always been a big topic of this conference. But that feeling of being surrounded by people, I think makes a big difference.

And, you know, as time went on, how it’s changed today, I would say the one word when people talk to me about diversity, I don’t think about women anymore, I really think of the word “inclusion” in about welcoming everybody’s opinion, you know, you have to speak up, you have to have a role. And whether that’s from China, from Japan, from Europe, a woman, a man, it doesn’t matter. I really think that that’s actually the biggest point that has changed.

JESSI HEMPEL: So, Ginni, now you are a real leader at this company. How do you encourage a community to speak up? How do you encourage people to find their places?

GINNI ROMETTY: You know, I’ll just give you truly my own personal view of leadership on this. You made a funny comment, Jessi, about everyone had their BlackBerry — well, not everyone, but a number of BlackBerrys put away.

JESSI HEMPEL: Sure.

GINNI ROMETTY: And I truly believe that part of that as a leader is I do very simple things. I mean, I ask everyone’s opinion when they don’t speak up. And then when they have an opinion, I’ll ask others to talk about it. I mean, these are really basic, but I think you’re often in environments where people don’t do that. And if it’s the norm and it’s expected and everybody has to speak up, you have to have an opinion, and you have to argue. You know, you have to stick up for what you believe in. And that, to me, is the biggest thing you can do about driving inclusion.

JESSI HEMPEL: So you have had the great fortunate of working under a number of what I would call “iconic” CEOs at IBM.

GINNI ROMETTY: Yeah.

JESSI HEMPEL: And I’d love to hear what you might have learned from Sam when you look at his leadership style.

GINNI ROMETTY: You know, lots of people in this room have worked for really great people as well. And I have been blessed, I’ve worked for both Sam and Lou Gerstner both. And when I think about all the years of what I’ve learned, you know, I think of a quote that I often hear from Sam. And what he always says is, “Nothing is inevitable.” Right?

And so, you know, I don’t believe in the inevitable. I don’t believe in it.

JESSI HEMPEL: What does that mean?

GINNI ROMETTY: So what it means is when you don’t believe in the inevitable, it means you don’t expect that that’s how things have to turn out. You can change them. And I think what it’s led and what I have learned from it is this idea of whatever business you’re in, it doesn’t matter, it’s going to commoditize over time, it’s going to devalue, you’ve got to keep moving it to a higher value. Keep going to a higher value in whatever it is that you do and force yourself and force the organization to always do it ahead of time, right?

And I think that that’s what — not that anyone would study us, but if you look at the history in the last decade, you know, we divested of a PC business almost seven years ago, right?

JESSI HEMPEL: Right.

GINNI ROMETTY: Long before. The focus on globalization, the build-out of the growth markets, the acquisition of Price Waterhouse Coopers, all the things to build higher-value skill. Actually almost half of our profit comes from software today. People don’t think of. So, it was always —

JESSI HEMPEL: Ginni, IBM did that early. It did that before it was obvious. Now, in hindsight, of course, everything feels obvious. But just thinking about your own experience of being with IBM at that time, was that nerve-wracking?

GINNI ROMETTY: You know, I think — one benefit — I’ve given in my time at IBM, right? Having been there a long time, I was also there at some of the most difficult — and there will always be difficult times, but certainly in the ’80s during the time when IBM had really lost its way. And I think once you have ever experienced that, you never, ever want to go back.

And so I don’t think it’s nerve-wracking. I think it’s more about this opportunity, look forward, keep going, and that it’s really a mindset. And I truly — I tell — whenever my mentees, and by the way, I should proudly say one of my mentees is in the room at number 39 on the list this year, so I could not be happier about that. (Applause.)

JESSI HEMPEL: Tell us who it is.

GINNI ROMETTY: Bridget Van Krelegen (ph), which I hope she’s here on time. I mean, I don’t know. (Laughter.) Don’t put a light up or anything. So, I couldn’t be happier about that.

So, I think you learn to always, like I say, this idea about always go to higher value and the other piece of advice I would say I have learned is this idea that no matter what, you’ve got to make new markets. Go and make a new market.

And, you know, I’m sure one of the things you all talked about — I couldn’t be here yesterday, but when I say “make a new market” I really believe one of the things that will distinguish businesses into this next decade is this area of how they use information. I don’t mean that as a technical point. I mean this really, truly as predictive, analytics, I think it’ll change culture, it’ll change everything that you do. And I believe it’ll differentiate the winners and the losers no matter what business you are in and how you do it.

And this idea of — so make a market — for us, we make a market around it, I think as a client, the ability to use it. I actually truly think that information in our next decade here in our generation, you could almost think of it as the next great natural resource. But it’s different than most natural resources. It’s abundant, it’s available, anybody could make something out of it, and I think that’s — that’s why I’m optimistic. I mean, this is what’s in front of us.

JESSI HEMPEL: So in just a moment I’m going to open the audience questions, but you know I have to ask you this, Ginni. Folks like me in the press have been writing for some time about how Sam Palmisano is 60 this year, an age often when IBM CEOs retire. And you are often considered to be the most likely successor. Is this a job you would want?

GINNI ROMETTY: I have a great job at a great company. (Laughter.)

JESSI HEMPEL: But do you think this is a good one?

GINNI ROMETTY: It’s a great company.

JESSI HEMPEL: Like, if you had to get a vanity plate — (laughter) for your car and it — okay.

How do you keep reinventing yourself? You’ve been talking about how to reinvent a company as it grows, but you spent a long time in one company. So, what’s kept you fresh and motivated and reinventing yourself?

GINNI ROMETTY: And I love your products. Okay? So I have to start there. (Laughter.) So congratulations to you.

You know, I will tell a story that I learned — maybe in the same spirit. We all have a lot of mentees here or people we mentor, and many of you are so accomplished. But when you say what keeps you fresh, I remember — and I want to connect sort of two stories. Really early, early in my career. I can remember being offered a big job. And I can remember the reaction to the person who offered it to me. I right away said, “You know what? I’m not ready for this job. I need more time, I need more experience and then I could really do it well.”

And so I said to him, “I need to go home and think about it.” And I went home that night and I’ve been married 32 years now. And my husband at the time, as usual, I’m blah-blah-blahing, and he’s just sitting there. And as I’m telling him about this, and I told him I would get back to them tomorrow. And he said to me, he looked at me, and he just looked at me and he said, “Do you think a man would have ever answered that question that way?”

And I sort of sat there — and it taught me a lesson. And he said, “I know you, you go do it, you’re going to — six months you’re going to be bored. You know, my goodness, why didn’t you –” And what it taught me was, and it’s related to how you stay fresh. What it taught me was you have to be very confident even though you’re so self-critical inside about what it is you may or may not know. And that, to me, leads to taking risks. Because I think it’s easy for people to say, “Take a risk, take a risk.” But I think it goes a little layer deeper.

In my experiences, I have talked to women around the world, it doesn’t matter what country I’m in. If I share that personal story, it resonates because people are their first worst critic, and it stops them from getting another experience because I could be better, if I was just ready yet, if I had one more thing. And that’s not it.

And I always say, you know, if I sit here and close my eyes and say, when did I learn the most in my life, in my career? It’ll always be when I close them and everything I think of is when I took a risk. It’s when I think I learned the most.

So, it’s a personal story of, to me, how you stay fresh at it is you always have to do something that puts you in a zone you don’t know. Someone once told me growth and comfort do not coexist. And I think it’s a really good thing to remember.

JESSI HEMPEL: Any other questions from the audience? Way over here.

AMY BANSE: Amy Banse from Comcast. I’d like your advice to make a new market. Can you tell us more about that?

GINNI ROMETTY: Yeah. You know, I would. I mean, I will. One thing I always think about in making a market, and it again is something I have learned from Sam as well, he always says, “Be first and be lonely, be first and be lonely.” Versus so often you’re drawn to a space where everyone already is. And instead, can you be first and be lonely in what it is that you go and make?

And the other part, this is going to sound like motherhood to you. My other experience with making markets, but particularly thinking about being out here on the west coast, if you really stay focused on what your beliefs are and what your customer wants, you’ll find the right markets.

I always say I think the most underrated question people often ask is — they’ll say, you know, “What’s your focus?” or this or that. And I often say, “Why don’t you ask me what I believe?” If you ask me what I believe, it’ll take me — I’ll make the right decisions, and you’ll understand why I go in the places I go and the decisions I make in the markets I make.

I often sit back and say, “Be sure about what I believe.” Because, by the way, if you’re clear about what you believe, you get this idea of clarity equals execution, and you can get a company to do great things because it isn’t so much about telling people what to do, I think it’s about getting people to understand why and have a shared passion about it. So, if you’re firm on what your beliefs are, you get a great foundation to go make a market would be my advice.

JESSI HEMPEL: Ginni, your business is so much about customers and you have such a large customer base, do you personally have sort of a guideline for keeping in touch with those customers, like, I spend 20 percent of my day talking to folks?

GINNI ROMETTY: You know what? To this day, with my job now, I still spend 50 percent — if not more — of my time. I counted 600 client meetings. And you would not be, like, 400 or something. I don’t count that way. (Laughter.) Last year. And it is another lesson, you know, Jessi said I’ve worked for some great leaders over the years. Another lesson was back to it’s the client, but what he taught me was time is the most valuable thing a client can give you, and always, always, you know, it’s prepare and bring them something of value, and that’s what we’re here for.

So, to me, I spend — like I said, at least 50 percent of my time, at least, if not more, with clients. I suspect everybody in here is similar.

JESSI HEMPEL: So we are now nearly out of time. I think if there’s one thing I’m going to remember from our time together, it’s that comfort and growth cannot coexist.